The Philippine economy should continue to grow robustly in the short term despite threats, Moody’s Investors Service said.
In a report, the credit ratings agency said the “re-emergence of conflict in the southern Philippines, as well as the Duterte administration’s focus on the eradication of illegal drugs,” are an “unlikely risk of a deterioration in economic performance and institutional strength” despite them being “rising” threats.
According to Moody’s, sound economic and fiscal policies including a focus on infrastructure development balance out political and other risks.
Among these risks are a possible worsening of the Islamist insurgency in Mindanao and the “continued uncertainties” over Duterte’s proposed comprehensive tax reform law that Congress had yet to pass.
“In the absence of a significant boost to government revenues from the passage of the (bill), the government will likely pare back its plan to aggressively increase its spending on infrastructure,” it added.
The report affirmed Moody’s short-term 6.5 percent GDP growth forecast for the Philippines this year and 6.8 percent in 2018. (Agence France Presse)